Gold prices edge down amid fears trade war could ramp up

Commodity Summary

MCX

BENGALURU: Gold prices inched down on Tuesday as the US dollar gained on worries over slowing economic growth and fears the Sino-US trade war could intensify again.

FUNDAMENTALS

Spot gold was down 0.2 per cent at $1,227.41 an ounce at 0200 GMT, after falling 0.3 per cent on Monday.

US gold futures were up 0.2 per cent at $1,229.30 an ounce.

The dollar firmed against its rivals on Tuesday, gaining 0.1 per cent.

The United States is preparing to announce tariffs on all remaining Chinese imports by early December if talks next month between presidents Donald Trump and Xi Jinping fail to ease the trade war, Bloomberg reported on Monday, citing unnamed sources.

Asian shares were under pressure in early Tuesday trade after Wall Street peers finished weak, hurt by the fresh worries of an escalation in the trade war, on track for the worst October since the financial crisis in 2008.

US consumer spending climbed for a seventh straight month in September, but income recorded its smallest gain in more than a year on moderate wage growth, suggesting the current pace of spending was unlikely to be sustained.

Growth in China's factory sector likely cooled further in October as domestic demand faltered and exporters felt a bigger sting from trade conflict with the United States, a Reuters poll showed.

Germany's Angela Merkel said that her fourth term as chancellor would be her last and that she would step down as leader of the Christian Democrats (CDU), heralding the end of a 13-year era in which she has dominated European politics.

The London Bullion Market Association (LBMA) will begin publishing data on Nov. 20 that will provide the most accurate picture yet of the size of London's gold trade, its chief executive said on Monday.

Banks and brokerages have cut their average gold price forecasts for this year and 2019 after the metal slumped to 19-month lows in August, but they still expect prices to stage a modest recovery, a Reuters poll showed on Monday.

Palladium's price premium over platinum will widen next year, with palladium set for its best year on record while platinum slumps to its worst performance since 2004, a Reuters poll showed on Monday.

Holdings in SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, rose 0.71 per cent to 754.94 tonnes on Monday.